Irish ‘blindly’ buying property overseas

IRISH overseas buyers were accused yesterday of putting little or no thought into purchasing property abroad.

The claim was made after it emerged that Irish buyers were increasingly signing foreign-language documents without knowing what they mean, and buying apartments without legal advice.

A legal adviser said Irish investors were playing ‘Russian roulette’ when it comes to overseas property.

Most people at home would not consider buying without seeking the advice of a solicitor but they are doing it abroad, according to Catherine O’Sullivan of Overseas Property Law (OPL) in Dublin.

Problems

“We have already seen a number of cases where investors have signed documentation without taking any legal advice, and have subsequently run into problems.

“While some buyers bring their contract to their own solicitor, Irish solicitors cannot be expected to carry the required overseas local legal knowledge to enable them to properly assist Irish clients,” Ms O’Sullivan said.

An Irish solicitor may be able to give a broad overview of the contract, but they will not be able to do the necessary searches to ensure that the seller owns the property and is entitled to sell it.

OPL warned all SSIA account holders who are considering investing their money in overseas property to seek independent advice before they leap into bricks and mortar in foreign lands.

As property prices in Ireland soar on a daily basis, many Irish people are choosing to invest in property abroad in a bid to get on the property ladder.

But OPL said it fears that many people will not investigate the legal and tax system accurately of the country they have chosen, and may experience major pitfalls along the way.

Ms O’Sullivan added: “It is imperative if you are considering buying property abroad that you thoroughly investigate both the tax and legal implications of your purchase.

“The best way to do this is to enlist the help of an independent adviser who has knowledge of the area you are buying in.

“We have already seen overseas investment horror stories that could have been easily avoided, if the investors had done their homework properly before they purchased.

OPL said some investors have even been forced to undervalue the property when the final transfer deed is signed, simply to reduce stamp duty.

However, this practice can actually lead to a higher tax liability further down the line.

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Les Calvert is the owner of overseaspropertymall.com and many other property and travel related websites. Les writes news and articles on the overseas property market for leading websites, trade magazines and newspapers.